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Episode 15
398 Plays1 year ago
Recruitment News Australia keeping you updated with all the news from the industry within Australia. Listen to Ross Clennett and Adele Last as they read the news and discuss a question of the week.
This week: Why do good recruiters leave good recruitment companies, a follow on from a blog of Ross's.
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Transcript
Introduction to Four-Day Workweek Benefits
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This is the news for the week beginning the 26th of June, 2023.
Impact of 180-100 Work Model on Retention and Attraction
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Employers implementing a four-day workweek scheme gave the model a 9.2 score out of 10, citing the benefits for retention, attraction, and productivity.
Increased Applications Due to Four-Day Workweek
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Senior managers from 10 Australian businesses who are implementing the 180-100 work model
00:00:29
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were interviewed by Swinburne University of Technology researchers to determine the compressed workweek's impact on their organisations. Employers said the biggest benefit from the scheme was the increased ability to retain and attract staff. Being able to offer a four-day workweek is clearly appealing to many candidates with one of the participating organisations reporting a 600% increase in applications compared to similar roles that advertised prior to moving to a four-day workweek, the report said.
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Nikki Beaumont, CEO of recruitment agency Beaumont people told researchers they were inundated with applications after announcing that they were implementing a compressed workweek.
Productivity Gains with Four-Day Workweek
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Findings also revealed that 70% of the respondents reported that productivity was higher after the four-day workweek was introduced, while 30% said productivity had remained the same.
Hiring Ukrainian Refugees Initiative
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Staffing giant Sadeko Manpower Group Randstad and Polish firm EWL Group announced they are committed to connecting 152,000 refugees to work. The staffing firms are among leading businesses pledging to accelerate the economic integration of Ukrainian refugee women and other refugees. 41 companies have collectively announced ambitious commitments to provide over 250,000 Ukrainian refugee women
00:01:46
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and other refugees with jobs and training across Europe. Brands include Hilton, Marriott International and Tala Performance have committed to hiring 13,680 refugees into their workforce. And major companies including Accentra, Generale and Indeed announced they are committed to training more than 86,000 refugees.
Australian Jobs and Skills Councils Launch
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Staffing firms made commitments to connect refugees to work over the next three years
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by including them in their contingent workforces as well as placing them in jobs with their clients across Europe.
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A trio of industry-owned and led networks combining employer and union stakeholders has been established to assist education and government partners in finding skilled solutions. Three new jobs and skills councils, JSCs, have been launched by the federal government in a bid to deal with workforce challenges for the manufacturing, transport and logistics, mining and automotive sectors. This includes how to deal with identified skill shortages.
00:02:45
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The Skills and Training Minister Brendan O'Connor released a statement explaining these groups would help the Jobs and Skills Australia Agency ensure workforce planning for respective sectors are aligned with government policy.
Role of JSCs in Workforce Planning
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Minister O'Connor said the JSCs were a way to bring tripartite leadership to make sure industry had the right workers and students received the best chance of obtaining secure and fulfilling work.
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These new JSCs will act as a source of intelligence on issues affecting their industries and provide valuable leadership and advice in addressing skills and workforce challenges, the Minister said.
Top IT Staffing Firms in the US
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Of the three JSCs launched recently, the Manufacturing Industry Skills Alliance will work to enable modern manufacturing and associated industries
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Industry Skills Australia will focus on Australia's core supply chain sectors and the Mining and Automotive Skills Alliance will help meet gaps in industries critical to Australia's economic, environmental, future and net zero ambitions. This year, staffing industry analysts identified 71 firms with $100 million or more in US generated IT staffing revenue, according to its latest IT staffing firms in the US 2023 report.
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These largest firms post revenue of $34.6 billion accounted for 83% of the market. The five largest IT recruitment agencies in the United States are Tech Systems owned by Allegious Group with revenue of $4.3 billion and 10% market share.
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Insight Global 2.9 billion, ASGN 2.7 billion, Analysts owned by ACS Group 2.4 billion, and Expirus owned by Manpower 1.6 billion.
Robert Walters' Profit Warning and Hiring Delays
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These largest fived firms accounted for 34% of the total US staffing revenue.
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Robert Welter's PLC in a trading update two weeks ago reported that net fee income for the first two months of the second quarter was down year on year by 10% in constant currency. This is compared to 0% annual constant currency growth in quarter one, 2023 and 4% actual growth.
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The group said that it now considered likely the profit for the full year ending 31 December 2023 will be significantly lower than current market expectations. According to Robert Walters board, reduced levels of Canada confidence and lengthening time to hire were signalled in the second half of the 2023 calendar year. And contrary to the board's prior expectations are not yet showing sustained improvement.
AI's Impact on Staffing Levels
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The SIA latest Pulse survey asked staffing firms how they expect the incorporation of AI to affect their firm's staffing levels over the next three years. In all, 23% of respondents expected that AI will lead to reduced staffing levels in their firm in the next three years, which is much outweighed by the 62% who expect AI to have a neutral impact on staffing levels and the 15% who expect AI to increase staffing levels.
RAF Diversity Strategy Criticism
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In the UK, the Royal Air Force has been alleged to have unfairly disadvantaged applicants seeking to become pilots in a bid to boost female and ethnic minority ratios in the organisation. A Freedom of Information investigation by...
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The RAF were described as useless white male pilots in leaked emails. The RAF is now reported to be paying 5,000 pounds each to 21 white male applicants who are forced to delay their training courses due to the policy. Air Chief Marshal Sir Mike Wigston, who leads the RAF, had previously insisted on a goal of 40% female recruits and 20% from ethnic minorities.
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Members of the RAF's recruitment team said their concerns, including Air Vice Marshal Maria Byford, who is Chief of Staff for Personnel, claimed she'd had to slow the recruitment process as targets were not being reached. Another senior recruiter,
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resigned in protest. Selection boards that only comprised white men were cancelled, according to the reports.
Why Recruiters Leave Agencies
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One source alleged that efforts had been made to fast track female ethnic minority candidates into one RAF location without them first taking the essential fitness test. On to our question of the week this week, Ross.
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And there has been a very interesting blog post of yours a couple of weeks ago that seems to have caused quite a lot of interest and a lot of conversation. And so we thought we might talk a little bit more about that blog. Can you give us some more details?
00:07:34
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Yeah, sure, Del, it was my blog. Why do good recruiters leave good recruitment agencies, which I published on the 8th of June. And just as a brief summary, when good recruiters, in other words, people who are producing good results and are valued by their agencies leave, really they're leaving for one of three reasons. They're leaving to go to a non-recruitment agency job. So it could be an in-house recruitment role or another sort of role. They're leaving to set up their own agency.
00:08:05
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Or, as I outlined in this blog, they're going to a competitor, another recruitment agency. And I don't know about you, Del, but certainly based on my LinkedIn updates, it just seems to be a little more frequent that that's occurring in the last few months. What's been your observations? Yeah, I would agree with it as well. In fact, some moves have surprised me, to be honest. I've seen people move from agencies who I thought
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probably wouldn't move very easily or at all. And so, yeah, I'm definitely seeing this sort of phenomenon increase. And your blog post was really interesting because you broke down what were some of the key factors in that. Tell us more about those, Ross. Yes, I listed five. First one's kind of the obvious one, money. People move for a larger base or a better commission scheme or maybe potential of equity.
Cultural and Leadership Impact on Recruiter Retention
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I mean, I'm always a little cautious about people moving for money. It's easy for a commission scheme to look better on paper. But of course, the most pertinent question is, will the person earn more money at the end of the year?
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what resources does a recruitment agency provide to a recruiter that effectively have to be paid for out of a inverted commas lower commission scheme compared to going to an agency where the commission scheme may look fantastic but there's you know not much support you've basically got to do it all so that's the first one second one culture leadership don't like their boss don't like the ceo
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Maybe they don't like their colleagues. Something's soured in terms of the relationship that that person has with the leadership and they don't see any change or maybe there has been change and they don't like that change.
Challenges of Hybrid and Remote Work Models
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So they're out the door. Third one, career development. I mean, I know one recruiter who left a small recruitment agency and went to much bigger ones simply because that recruitment agency was an executive recruiter. They had a retained model.
00:10:13
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they were going to be working on more senior roles and they wanted that and that just wasn't the model of their current employer. So they actually left on reasonably good terms like the owner of that agency kind of
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you know, empathize and say, well, you know, I can't really provide that here. Fourth one, ego, you know, rectorex, they're very active in the market as, as you would know, Adele, their business model is simply trying to connect with the best recruiters and lure them across to another agency. Let's face it, who doesn't love a call from someone who's stroking your ego and saying, oh, you know,
00:10:50
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Let's talk about the opportunity in my you know in my clients business and of course when people are having a stroke you know it's quite tempting to just.
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feels like you're not getting the same level of attention at your current employer and it's all very nice to bask in that warm glow of the Rectorix soothing words. And finally work arrangements. I mean this is clearly something quite different compared to the era when you and I were
00:11:25
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at our peak as agency recruiters because of course there was only five days a week in the office whereas of course now there's many different options there's working four days for five days pay you can have a hybrid option
Satellite Office Challenges
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of some days in the office and some remote and of course some agencies provide the option of remote
00:11:48
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So they're the five that I went through. I didn't state that they were in rank order, but I would be interested to know your view, Adele, in terms of recent departures. What's your sense of the most important one of those five? Perhaps we can talk about your ranking overall. Yeah, I think they're all spot on as the top five and it is hard actually to rank them because obviously for different people,
00:12:15
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they would have significance and importance to different people. I think there's an element in there as well, really post COVID that people are much bolder about making a jump because it doesn't feel as permanent. And this bothers me too as a bit of a phenomenon that people are perhaps more likely to take the risk and leave a company
00:12:38
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knowing that there's just so much opportunity out there. So when it's so candidate short, it's not as great a risk as it used to be where if I leave this company, will I get another job if it doesn't work out? Could I go back to my employer? And those questions are all yes at the moment. Yes, you'll find another job if you take a bad choice or your current employer will probably take you back in fact. So it's a really interesting one that's I think making people in some cases make
00:13:08
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some rash decisions or quick decisions or chasing things like money and ego and the like. But I think the top one out of all of those is got to be culture and leadership. It's always been said that people join
Keeping Employees Engaged
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a business and they leave a manager or leave a leader. The main reason that people are unhappy is always about or has relationship to the way they're being managed or the way the leader perceives them or their value in the business.
00:13:35
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how they feel they fit in and the cultural elements of the business. So I think that one to me is number one. And I think that's been impacted in many organizations by number five of the working arrangements where you just don't have the safe. It's really hard for a business now who has a remote or hybrid working model to maintain that strong sense of culture. It's really hard to establish that, especially in the early stages in those first weeks to months.
00:14:04
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for a new employee to get a really good feel and if they don't align quickly it just starts to get wobbly from there I feel and they start to leave. So number two and number five in your list to me are the prominent ones. I didn't talk about this in my blog but subsequently I did think a little about this.
00:14:25
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If you're in a big recruitment agency, that's good. But if you're not in the head office, if you're in what I would call a satellite office, because there's really only one head office, like typically it's the city or the office in which the agency started. And that's always going to be the hub. And that's always going to have more people. It's going to generally have the support functions. There's generally a better
00:14:54
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accommodation fit out. There's just generally a better vibe.
Post-COVID Culture Audit Advice
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I just think for some recruitment agencies, no matter how good their head office is, if their satellite office just isn't as good, the recruiters
00:15:10
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in those offices more susceptible to a head office in their city a recruitment agency head office poaching them and bringing them into their office if you're in a satellite office with 10 people and you go in in the same city to the head office of another agency and there's 50 people and it's got
00:15:29
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you know, great fit out and it's got more of a pumping vibe. Like, you think that's going to have, like, you know, is that going to be a factor in play in someone considering leaving, even if they're not actually unhappy? Yeah, don't underestimate the power of that massage chair, hey? So what sort of advice would you give to agency owners if we're talking about this topic? What's the best way to manage or to make sure you're across
00:15:58
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this sort of phenomenon, if you've got good recruiters and a good agency, you're no longer fully protected to sit back and say we're safe. What should agency owners do, Ross? Well, certainly no one's ever safe. I mean, the simplest advice, it's easier said than done, but just stay close to your people. Just having a coffee, having lunch, not a performance conversation, but just checking in, how you're going, and just kind of sensing, are they a flight risk?
00:16:27
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I mean, of course the person, well, not of course, but the person is not likely to tell you if they are. But in a 45, 50 minute conversation over coffee or lunch, you're probably going to get a sense that maybe they're not quite as committed as they used to be, or there's some little chinks there that you sense like, hmm, this person could be vulnerable.
00:16:50
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So I think that's just the simplest thing, like, yes, of course, paying people more and all of that is nice. Awards nights, all of that is nice, but it's just staying close to people because, you know, most people in agency recruitment who make these moves, they're in their 20s or early 30s. They're going through transition in life. Maybe they're in a significant relationship or thinking about
00:17:14
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children, all of those things. So you just want to stay close to people and just find out where they're at, keep talking to them. And hopefully they'll open up for you and it'll give you a chance to perhaps talk about their careers. So what about
Podcast Engagement Call to Action
00:17:28
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you? You have a lot of career discussions. So what advice do you have? Yeah, I love that advice as well. And, you know, as you said, keeping close to them, so you're keeping the conversation open.
00:17:42
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And I think just being really conscious about making sure you're building culture as an owner or a leader of business. What is your culture? Take a bit of a culture audit. I think don't sit back and rely on a pre-COVID, mid-COVID, even early stage post-COVID, you know, oh yeah, everything will be fine. I think it would be wise, 2022, you know, half of 2023 or the new financial year, take it as a bit of a warning to do a bit of a culture check.
00:18:10
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and make sure it is still aligned to the people that you've got.
00:18:14
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Yeah, because as as we know, Adele, there are plenty of hungry rectorex out there who are reaching out. No, no, this is their job. I have complete respect for rectorex because this is their job. And this is an important part of the competitive employment market. The ACCC is very vigilant about restrictive practices. So rectorex are a very important part of a fully functioning
00:18:41
Speaker
Recruitment agency labor market and I'm certainly not endorsing any particular one and I appreciate the pain that agency owners feel when a wreck-to-wreck has enticed one of their people out but It's the reality. They're out there. They're gonna stay out there. So They're gonna keep every owner on their toes
00:19:02
Speaker
Yeah, watch those sharks. Keep your team in the boat. Well, thank you for allowing us to tease out that blog post. It was a really interesting one. I think one of your more popular ones had a lot more focus, I believe, than others recently, which is great to hear. Hopefully you all enjoy hearing that. We do a question of the week usually, but we decided to take a little bit of a different curve on this one today. Let us know in comments or on our
00:19:31
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posts, whether you like that sort of format, we might change it up a little from time to time. Thanks very much for listening. That's a wrap. Don't forget to subscribe to the podcast wherever you get your podcasts from, Google, Apple, Spotify, or on our website.